Monday, November 12, 2012

Monday Muse: How to Run a Raffle Without Going to Jail

I am so grateful for the many people who have enthusiastically come forward and donated prizes for our raffle! Sandra, the lovely owner of the Henry Whipple House Bed & Breakfast in Bristol, responded within two minutes of my request for donations. She's offering a one-night stay for two at her beautiful bed-and-breakfast; that's a prize worth over $160! The Mt. Washington Observatory has also offered a valuable gift -- two, actually -- I now have two family memberships to raffle away, each worth $75. Steve Smith from the Mountain Wanderer Map and Bookstore donated a $25 gift certificate. Others have also responded, including one NH fellow who's contributing the grand prize out of his own pocket -- $500 cash! Folks continue to contact me with offers of raffle prizes, and I am extremely grateful to each and every one of them.

To our supportive and generous friends -- THANK YOU. We could not run this raffle without you!!

So -- I've got great prizes to offer, and since all the money is going to charity, I should have no problems selling tickets, right?

Well, that depends. Federal and state laws must be obeyed. Raffles are, after all, games of chance. In other words, if the ticket costs money and there are prizes involved, then the raffle is considered a form of gambling.

And if it's gambling, as most raffles truly are, then the laws are tricky. One needs to be extremely careful if one doesn't want to end up in the slammer.

Learn from my experiences -- if you want to run a raffle for charity and you live within the state of New Hampshire, then read the following...and then check with your lawyer and/or the Department of Justice before you proceed. Please note that I am not a lawyer and this post is not the equivalent of legal advice. I'm just a woman describing my own experiences. YOU should consult a lawyer.

First, you need a permit. For me, this wasn't an issue. I filled out an application and included a full explanation of my purpose and intent, and my permit was issued without any complications by my local Board of Selectmen.

Next, you need the tickets themselves -- and you need to follow the state law in regard to the appearance of those tickets. New Hampshire state law dictates that each ticket must have specific information printed on it (date of drawing, main prize, etc.). Of course, ordering tickets that comply with state law isn't a problem -- it's easy enough to find a company that will make and ship custom raffle tickets.

Once you have the permit, the prizes, and the actual tickets, then you're ready to roll, right?

Well...kind of. Once you have the above, then you can go ahead and sell your tickets in person. Problems could arise, however, if you try to sell tickets over the internet or through the mail.

Is it possible to sell tickets online? Maybe. Different states have different laws, and these laws are in flux. As of right now, November 12, 2012 at 6:37pm, I'm not sure where New Hampshire stands. I've spoken to three different lawyers and been told two different things. My plan is to call the NH Department of Justice tomorrow morning and ask their advice. EDIT: NH Department of Justice told me they can't advise when it comes to federal laws. The US Department of Justice said online sales could be tricky...interstate regulations apply. I therefore decided not to allow online sales.

You might do a quick search on the internet and find folks/organizations who are selling tickets online...but that doesn't mean they're following the law. If you plan on running a raffle, then be sure to investigate this matter thoroughly with your lawyer(s) and your state's Department of Justice.

Even if you can sell tickets online, you can't mail the tickets to anyone. Mailing raffle tickets is against federal law. Again, if you look online, you'll see examples of folks mailing raffle tickets anyway...but that doesn't mean it's legal.

Can you sell tickets to people who live out-of-state? This is another gray area. Check with your local and state laws. I don't think I'm allowed to, for my particular raffle, but I hope to find out once and for all when I call the Department of Justice tomorrow. However, regardless of my own situation, you should check with your own lawyer. There are no nationwide standards when it comes to...well...anything regarding the sale of raffle tickets. EDIT: The folks at the US Department of Justice said it would be fine for me to sell tickets to out-of-state visitors to NH -- I just can't visit other states to sell tickets, and I can't mail anything having to do with the raffle.

Organizing a raffle is a complicated affair. Would I do it again, all things considered? Yes, absolutely! In spite of the legal red tape, I'm having fun and I am so thankful for all the people/organizations who are offering such wonderful prizes. The Mt. Washington Observatory has agreed to have tickets available at the Weather Discovery Center in North Conway, and I have a few places on my schedule for personal ticket sales. By the end of the week, I should have at least half a dozen more stores/events that will host ticket sales...in other words, because of our friends, supporters, and wonderful local business owners, we should be able to sell a healthy number of tickets in person....and *maybe* we'll be able to sell online (stay tuned).

So, in sum -- get a permit, get your tickets printed according to state law, and plan to sell the tickets in person and not online or by mail. And, of course, you should talk to your lawyer -- this post is no substitute for legal advice.

Thanks again, friends and business owners, for supporting our cause and donating such wonderful prizes.